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The New Rules of Marketing

The old rules of marketing no longer apply. In fact, these rules of thumb can actually prove dangerous to your company’s success. It’s time for a better set of rules that can maximize your return on marketing and commercial investment.

The traditional way of doing things isn’t as effective as everyone assumes. Take a look at some of the findings from BCG's benchmarking study on marketing effectiveness.

Common Rule of Thumb

Impact

Tying marketing budgets to revenues

Brands with higher budgets as a percent of revenue saw stagnant sales volume and realized lower gross margin per dollar of marketing spend.

Maintaining or overinvesting in share of voice

Brands with a higher share of voice, absolutely and relatively to their market share, did not drive more volume and realized lower gross margins per dollar of marketing spend.

Investing in brands with the highest market share

Volume due to marketing did not vary appreciably based on a brand’s share, but brands with higher share realized lower gross margin per dollar of marketing spend.

Investing in high-margin brands

This tactic did not deliver higher marketing volume and returned less incremental gross margin per dollar of marketing spend.

Integrating campaigns to realize synergies

Using more vehicles without maintaining or increasing the average spend per vehicle yielded less volume and lower gross margin per dollar of marketing spend.

Strategic

Key Levers

Core Principles

Precise allocation of the portfolio

Allocate resources to brands with high potential and high commercial response.

Clear commercial objectives

Align on a few specific objectives.

Focused customer targeting

Focus on the highest-value customers.

Tactical

Key Levers

Core Principles

Level of spending

Find your sweet spot; above the minimum and below the maximum.

Commercial mix

Optimize on the basis of driver efficiency.

Timing of activities

Balance message reach and frequency.

Operational

Key Levers

Core Principles

Organizational alignment

Align disparate commercial disciplines.

Process integration

Integrate pan-commercial processes.

Metrics mindset

Embrace a culture of measurement.

Analytical competence

Enhance analytical talent and tools.

Systems and infrastructure

Determine what, who, why, when, and how often.

Marketing & Sales
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